This Little-Known Fed Index May Be Signaling Recession

By: David Sterman Street Authority

Over the past year, economists have noticed an unusual pattern as they digested the series of monthly reports on housing, consumer confidence, purchasing managers, trade flows and other key economic inputs.

These reports showed consistently mixed signals, though it was clear that the U.S. economy was faring OK. And that has led to hopes of more consistently positive reports in the second half of 2013 and into 2014. By next year, many economists have come to expect a firmer backdrop, with GDP perhaps growing in the 2.5% to 3% range.

Yet it may be time to start questioning that brightening outlook. Perhaps the greatest measure of economic activity -- one ignored by most investors, unfortunately -- is flashing yellow and may soon be flashing redContinue reading "This Little-Known Fed Index May Be Signaling Recession"